Consumer Protection
Consumer protection has been a social issue since the early 1980s. With the
rapid growth of the economy and the significant rise in income, consumers began
to demand product safety and quality. As a result, the government has pushed
ahead to implement consumer protection policies aimed at both enforcing stricter
consumer related regulations and providing easy access to product information
to all consumers. In particular, after acquiring membership in the OECD in 1996,
the government has introduced several advanced policy measures aimed at consumer
protection, including the recall and injury data collecting system for all consumer
products.
The Consumer Protection Law (1980) is the basic law for consumer protection.
This law specifies consumer's rights, business's obligations, and the government's
role in consumer protection. Other laws related to consumer affairs include
the Door-to-Door Sales Law, the Installment Sales Law and the Stipulation Regulation
Law, which were all introduced in 1986. In order to reinforce consumer protection,
the government enacted laws such as the Consumer Cooperatives Law (1999) and
Product Liability Law (2000). Consumer Cooperatives Law will facilitate direct
transactions between producers and consumers. Product Liability Law will strengthen
consumer safety and help facilitate settlement of consumer disputes.
Organizations
Governmental Bodies
The Consumer Policy Deliberation Committee (CPDC) formulates year by year national
comprehensive consumer policy and deliberates on matters related to drafting
and revising laws or regulations. The CPDC, which was established on the basis
of the Consumer Protection Law, consists of ministers in charge of consumer
policy, representatives of consumer organizations and business associations.
Each ministry takes charge of consumer policies respectively. The Ministry of
Finance and Economy (MOFE) regulates comsumer credit while the Korea Fair Trade
Commission (KFTC) handles unfair trade practices as well as fraudulent or misleading
labelling and advertising. The overseeing of food and drug safety is handled
by the Korea Food and Drug Administration (KFDA). The Ministry of Commerce,
Industry and Energy is responsible for consumer products safety.
Seven metropolitan cities and nine provinces have their own consumer protection
ordinances and bodies, which are called the Consumer Protection Section. They
were established to enforce consumer policies. At the local level, consumer
policies are geared toward implementing regulatory measures, providing consumer
information and stabilizing retail prices.
Korea Consumer Protection Board (KCPB)
The Korea Consumer Protection Board (KCPB) was established on July 1, 1987 in
accordance with the Consumer Protection Law. The Board, located in Seoul, is
an independent, semigovernmental organization financially supported by the government.
Its function includes policy research, conducting surveys, providing consumer
education, disseminating consumer information, redressing consumer complaints,
as well as conducting product comparative testing.
The KCPB conducts surveys on unfair practices and hazardous products. It also
reports on whether laws, regulations and institutions regarding consumer protection
are carried out. Its results are used as a basis for providing consumer information
and recommending policy alternatives to governmental agencies.
The KCPB publishes reports, study materials, legal information, fact sheets,
and market reviews. The publications issued by the KCPB include Sobija Sidae
(The Age of the Consumer), a monthly magazine which contains a vital resource
of useful consumer information as well as consumer redress procedures. And Sobija
Munje Yeon-gu is an annual research journal on consumer matters. The Consumer
Newsletter in English version is published quarterly. In addition, the board
publishes several pamphlets as well as audiovisual materials to enhance consumer
awareness.
The board also provides consumer information through a computer communication
network. The database contains various kinds of consumer-related information,
including information on consumer complaints and damage cases, and consumer-related
statistics. The KCPB homepage (www.cpb.or.kr) contains Sobi-Net, Price and Market
Information Site, eConsumer Site and Consumer Safety Net. Sobi-Net (sobinet.cpb.or.kr)
is information network accessible via the Internet and is jointly managed by
the KCPB, local government, consumer groups and businesses. Price and Market
Information Site (price.cpb.or.kr) is a portal site providing easy access to
price and market information. The eConsumer Site (www.econsumer.or.kr) provides
a broad range of information on consumer protection in e-commerce, and the Consumer
Safety Net (safe.cpb.or.kr) is a hub site for consumer safety information. The
KCPB has been actively participating in the activities of international organizations
such as the OECD Committee on Consumer Policy, and the International Marketing
Supervision Network (IMSN). Also the Board has been strengthening cooperation
and collaboration with such organizations as Consumer International (CI), and
the National Consumer Affairs Center of Japan (NCAC).
A consumer organization recruits members on a voluntary basis. Under the current
Consumer Protection Law, consumers can form organizations to represent their
interests and give voice to their opinion when consumer policy legislation is
being undertaken.
There are 10 associations affiliated with the Korea National Council of Consumer
Organization, three of which are located in Seoul. The number of local affiliates
belonging to the organizations amounts to about 240.
These consumer organizations conduct surveys, testing remedies and assist consumer
complaints. In addition, they serve as a watchdog to keep the prices of daily
commodities reasonable and stable. Consumer organizations in Korea also exchange
information with international consumer groups to insure consumer protection
in the international market.
Consumer Safety
Consumer protection takes priority in consumer safety issues. The government
established the Korea Food and Drug Administration (KFDA) in 1997 in order to
cope positively with the safety problems related to foods and drugs. The KFDA
performs inspections and tests on foods and drugs which are circulating in the
domestic market to sort out unsafe and harmful products. Consumer goods are
examined and tested by the Korea Agency for Technology and Standards (KATS),
a government body established to prevent unsafe goods circulating in the domestic
market. The Ministry of Health and Welfare (MOHW) takes charge of agricultural
and marine food safety.
The KCPB is also acting to reinforce safety standards and to gather data related
to consumer injury. In order to gather this information which is supposed to
be used as a source for strengthening safety standards, the government is operating
the KCPB as a Injury Data Collection Institution. Under the Injury Data Collection
System, selected hospitals, police stations, fire stations and schools are designated
as reporting agencies, and they regularly inform the KCPB of injury information
they gather. Information received by the KCPB is then compiled and analyzed.
The Consumer Protection Law regulates products safety conditions. The statute
contains provisions about a comprehensive recall system.
The government is committed to improving the price marking system in order to
facilitate price competition among retailers to foster price stabilization.
In this context, an open price system was introduced in 1997 involving cosmetics
and drug products.
The government also plans to allow the open price system to be applied to other
products, like industrial goods and foods. Consumer organizations and the KCPB
are keeping close tabs on whether the labelling and advertising of products
done by businesses are false or exaggerated. If the contents of labelling and
advertising are proven to be false or exaggerated, the businesses will be accused
of violating the Fair Labelling and Advertisement Law (1999).
The Korea Fair Trade Commission (KFTC) examines stipulations used when contracts
are formed between consumers and businesses. If it is revealed that these stipulations
are unfair, the KFTC can have them repealed. In addition, the KFTC also distributes
standardized business stipulations for a variety of business transactions.
Consumer Information and Education
Consumer information is provided by consumer organizations and the KCPB, through
a variety of media. Each ministry is required to make consumer information public.
The KATS tests industrial goods and offers the results to the public domain.
Consumer organizations also make public the results of their activities including
surveys and tests.
The KCPB provides consumer information through an on-line computer network.
The KCPB homepage contains the results of research conducted by the KCPB, involving
price information, and warnings on probable injury. Consumers can also log on
to the Internet homepage of the KCPB to find useful product information. The
KCPB also provides consumer information through a number of periodicals and
independent volumes and reports.
The purpose of the consumer education is to make consumers aware of their rights
and force businesses to comply with consumer product and safety regulations.
In middle and high schools, students are taught the importance of consumer rights
under the regular school curriculum so that they can become educated consumers.
As a part of adult consumer education, consumer organizations and the KCPB provide
diverse educational programs. Consumer organizations offer lectures on numerous
consumer issues. The KCPB has also been operating multiple kinds of consumer
education programs. In addition, the KCPB produces audiovisual educational materials
and teaching texts which can be used as tools for consumer education and distributes
them to major organizations engaging in consumer protection, such as schools,
central and local governments.
Complaints and Redress
Consumer complaints are received and handled by local consumer counseling centers,
consumer organizations and the KCPB.
Intervention on the part of the KCPB begins when a consumer initiates a complaint.
In most cases, companies agree to put matters right voluntarily. If they fail
to do so within 30 days, however, the Consumer Disputes Settlement Commission
(CDSC) takes legal action. The CDSC, an agency for alternative dispute resolution
(ADR), is composed of a chairman and 29 other members, who are selected from
both the legal and academic communities, as well as from both industry and consumers.
If the parties involved in the dispute agree on the mediation offered by the
CDSC, the agreement has the binding power of a judgment in a court. For the
purpose of streamlining the procedure of complaint redress, the KCPB has started
to develop a consumer complaints handling system which is expected to enable
provincial governments, consumer organizations and the KCPB to cooperate with
one another through an on-line network.
Meanwhile, the KCPB has established an on-line counseling site which will be
able to receive consumer complaints. Complaints received through the KCPB Internet
homepage are compiled and analyzed. They are later used as data for devising
policy measures for protecting consumers. As electric commerce is growing rapidly
in domestic market, the KCPB joined IMSN. IMSN is a network of governmental
organizations involved in enforcement of fair trade laws and other consumer
protection activities. The KCPB also launched an e-commerce surveillance system
named the Internet Sentinel. In addition, the KCPB held a nationwide Internet
Sweep Day Campaign to create a healthy Internet environment.
Nongovernmental Organizations
Korean NGOs and Their Prospects
Since the 1980s, the activities of nongovernmental organizations (NGOs) in Korea
increased dramatically. As of 1997, they numbered over 10,000 - an indication
of the growth of Korea's civil society. These organizations cover a diverse
spectrum of interests including labor, the poor, women, youth, social welfare,
charity, consumers, human rights, the environment, politics, economy, religion,
mass media, culture and the arts. These groups are beginning to expand their
activities overseas. Many representative Korean NGOs, such as the Citizens'
Coalition for Economic Justice or Korean Federation for Environment Movement,
have been actively collaborating with related international organizations.
Korean civil organizations first developed in opposition to the government.
From the government's viewpoint, these organizations represented a challenge
to state authority and therefore had to be suppressed. At the end of the 1980s,
however, Korea's democratization movement began to bear fruit, with the result
that social movements, which had previously been immersed in the struggle against
the government began to take on other issues.
In the last several years, these movements have even begun to undertake substantial
overseas projects. The Korean government has likewise established an organization
for international civic cooperation. Founded in 1991, the Korea International
Cooperation Agency (KOICA) is managed as a governmental aid organization under
the auspices of the Foreign Affairs and Trade Ministry. In addition, NGOs such
as Korea's UNICEF Committee have participated in work helping underdeveloped
nations in Africa and Asia. Projects have dealt with disaster relief as well
as general services to improve the quality of life. Activities have also included
specific projects aimed at the development of potable water facilities, environmental
improvements, disease treatment and prevention, basic education, and technical
support. There are also a number of Korean religious missions to Africa, that
send missionaries and provide on-site aid. In addition, the Korean Red Cross
and other organizations work with international groups such as the World Food
Program (WFP) to provide aid to starving people in North Korea.
Having worked for the public good of the nation, Korean NGOs are beginning to
focus on projects benefiting the global community. These organizations work
to alleviate hunger, which threatens a quarter of the world population, and
deal with issues such as human rights, aboriginal rights, women's rights, in
addition to projects aimed to promote democracy and protect the environment.
In order to be more effective, they are now seeking to network and cooperate
with other NGOs around the world.
Korean Civil Movements
During the last 10 years when the civil society has been formed and developed,
the Korean civil movement has indeed made rapid progress. At present, thousands
of civil society organizations have been established and have worked actively
in various fields. Although every organization has not made equal progress,
the quality of services has generally enhanced. The civil society organizations
in Korea enjoy great support and expectations and exercise significant influence.
It is during the last 10 years that the civil movement has taken root successfully
in Korean society.
One could attribute the success of the Korean civil movement in an underdeveloped
political structure. However, the main reason is that it struggled for the democratization
of our society through the 1980s and then the political resistance shifted its
force to civic causes.
Reviewing the present status of Korean civil society organizations, there were
4,023 civil organizations in Korea as of the end of 2000 with more than 20,000
local branches. About 20 percent of them were established in the 1980s, 56 percent
in the 1990s; 56 percent of them are centered in Seoul; the average number of
members is 6,284; average number of staff is 7.76. 54.4 percent of them are
unregistered, 40.9 percent are incorporated, 7.7 percent are foundations and
0.9 percent are special corporations.
Among these civil society organizations, Citizens' Coalition for Economic Justice
(CCEJ), YMCA, People's Solidarity for Participatory Democracy (PSPD), Korea
Women's Association United (KWAU), Korean Federation for Environmental Movement
(KFEM) and Green Korea United (GKU) are said to be the most influential organizations.
CCEJ, YMCA and PSPD may be called general civil organizations as they work for
diverse social issues. Specially, CCEJ which was founded in 1989 as the first
of its kind, and PSPD, founded in 1994 claiming to be a progressive civil movement,
are the representatives of Korean civil organizations in the 1990s.
On the other hand, the KWAU, KFEM and GKU are focusing on special issues such
as environment or women's rights. Looking at this we see that there are a few
general civil organizations, however, most others are special organizations
with small members and structure.